#Futures – Got excited and had to share. Took 19 points out of the NQ futures in my first live money try using the Theo Trade strategy. Just played the tiny bounce off 7100…
If I can generate enough cash with some rolls this week, I might start nibbling on SPY IC or at least one sided credit spreads. Would be a shame not to at least collect a few $ with the premiums being higher than they have been in a long time.
Sold LMT pre-ER long calls @ 94% loss and BWB for 38% loss. Still holding double calendar thru earnings to reduce losses.
#Earnings Sold to Open $BIIB Oct 26th 285/350 strangle for 3.35. Filled on 1, have another 1 pending. Strikes are just outside expected move when I posted the analysis earlier. However, IV has dropped intraday and now expected move is 296 to 343, which is the same as the MAX moves over last 12 quarters.
I’ll likely sell a third later in the day, but 3 is my max at this high of a stock price.
Bot LMT Oct26/Nov2 325 put/call @ 1.95. Will hold thru earnings as a potential salvage trade for the pre-ER positions not working out.
Big move down after earnings.
Sold $KMB Jan 18 95 puts @ 1.35. Strike is at what would be a 5 year low (last traded at 95 in Oct 2013). Stock at 105.61, delta of puts 18.
I roll my November 2, 58 calls to November 9, 58.5 calls for a credit of .30 cents. I need .18 cents per week so I am getting an extra .12 cents and an increase in the strike price of 1/2 point.
Sold two BWB (broken-wing fly) for average 10% profit. Got out based on hitting target price on LITE. The flies don’t profit as much as the long calls but they have less risk too.
STO November 2, 72 calls @ .55 cents. These are against my 2020, 115 calls but I still have 64 weeks to earn the premium to pay for this position.
#LongCalls Bought $SPY Nov 16th 284 calls for 1.25, adding to my position.
Bought to close $NFLX Nov 16 400/410 bear call spread for .21. Sold for 2.00 on 10/17.
Covered calls. STO November 2, 54 calls @.30 cents.
Sold BABA pre-ER positions for average profit of 31%. Based on possibility of China one-day bounce.
#Earnings $BIIB reports before the bell tomorrow morning. Below are details on earnings 1-day moves over the last 12 quarters.
July 24, 2018 BO 4.10%
April 24, 2018 BO 1.09%
Jan. 25, 2018 BO 2.08%
Oct. 24, 2017 BO -3.90%
July 25, 2017 BO -0.61%
April 25, 2017 BO 3.62%
Jan. 26, 2017 BO 2.06%
Oct. 26, 2016 AC -1.87%
July 21, 2016 BO 7.63%
April 21, 2016 BO 5.15%
Jan. 27, 2016 BO 5.15%
Oct. 21, 2015 BO 3.96%
Avg + or – 3.44%
Bias +2.37%, upside bias on earnings.
With stock at 319.00, the data suggests these ranges.
Based on current IV (expected move per TOS): 288.77 to 349.23
Based on AVERAGE move over last 12 quarters: 308.04 to 329.96
Based on MAXIMUM move over last 12 Q’s (12.1%): 294.66 to 343.34
It is rare that the implied volatility is predicting a move that is larger than the stock’s biggest moves over 12 quarters. There is decent premium beyond the IV extremes, but bid/ask spreads are wide. Stock is currently at the 200 ema.
Equity futures prices have climbed overnight and are looking to open higher following the biggest rally in Chinese equities since 2015. China had a huge day rising 4.1%.
Read more in our Morning Lineup: https://t.co/AuqANPJSJP pic.twitter.com/yf1ShvFsmN
— Bespoke (@bespokeinvest) October 22, 2018
Gartman says we could go down 15 to20% from here. Buy,buy,buy.